Verizon Communications Inc. shareholders will vote Thursday on a proposal that could make it more difficult for senior executives to receive huge equity awards worth millions of dollars.
The 128,000-member Association of BellTel Retirees, which introduced the proxy proposal, contends senior execs can obtain half of their target award even if the New York-based telecommunications titan performs below the 30th percentile in its group of peers.
The criteria measured is return on equity for shareholders with Verizon compared to large Dow Jones companies as diverse as American Express, Coca-Cola, Exxon Mobil and McDonald's.
Under the proposal, Verizon senior executives only would be entitled to the long-term incentive awards in the form of Performance Share Units "if Total Shareholder Return (TSR) equals or exceeds the median performance of the Related Dow Jones Peers, or whatever peer index the Board deems appropriate."
Verizon's annual shareholder meeting takes place Thursday, May 3, at 10:30 a.m. CT, in Huntsville, Ala.
Verizon's board is recommending shareholders vote no on the proposal, and even if passed by a majority, it's just an advisory vote. That means the board wouldn't be required to enact the measure. The proposal was introduced last year and received 30 percent of shareholders' votes, according to the Association of BellTel Retirees.